Leverage is very important for maximizing returns, but too much is counterproductive. Sometimes even 1x is too much, or even 10x is not enough. The right amount is the Kelly fraction and it depends on the payoff distribution of your strategy, which you can only estimate. This is mostly what I was getting at in How to Lose a Fair Game
I came in here to say leverage. There are options outside of margin lending that are interesting to explore, such as:
Investment Loan (Although the rate is similar to that of a margin loan)
Home Equity Line of Credit (Cheaper than the above)
Borrowing to re-investing and pledging your assets as collateral has been used for decades by wealthy investors to increase their return.
Box spreads. That’s still margin though.
Leveraged ETFs.
Leverage is very important for maximizing returns, but too much is counterproductive. Sometimes even 1x is too much, or even 10x is not enough. The right amount is the Kelly fraction and it depends on the payoff distribution of your strategy, which you can only estimate. This is mostly what I was getting at in How to Lose a Fair Game